Town of Owego explores lower residential electric rates

Both the Village and the Town of Owego are examining a potential rate reduction for NYSEG customers under a project introduced by MEGA, The Municipal Electric and Gas Alliance. A plan authorized in April 2016 by the NYS Public Service Commission, gives local governments the ability to aggregate utility customers to lower energy supply costs. 

The Community Choice Aggregation (CCA) program would allow MEGA to bid for low fixed rates from Energy Service Companies (ESCOs) for a large pool of residential users. According to Danielle McMullen, a representative of MEGA, an aggregate pool of 40,000 customers has the leverage to bargain for a lower Kwh rate than individuals can get from NYSEG. If the local governments vote to take part, residents would have a fixed rate electric supply charge for a term of 18 to 36 months depending on how favorable the rates are for consumers.

Over 100 Apalachin residents attended an information session at the Apalachin Elementary School on May 9 to learn about the program. 

“Community Choice Aggregation is a group purchase of electricity,” said McMullen, adding, “With Community Choice Aggregation, you and your neighbors will increase your individual buying power.” 

Several steps are needed before citizens can see savings through the CCA. A minimum 60-day education and community outreach period is required, then a local government needs to pass a law to authorize the CCA at which point MEGA would solicit bids from energy service companies, select a low-bid supplier, negotiate a contract term from 18 months to three years and transfer the supply portion of the electricity from NYSEG to the chosen ESCO. 

Residents in the aggregate would automatically be covered, however individuals could opt out and if a customer currently receives energy from an ESCO they can continue with that supplier or opt in. If a customer is under contract with an ESCO and wishes to opt in after the contract expires they will be allowed to do so.

Depending on the community, McMullen says, “it will enable residents to get access to renewable or green electricity.”  MEGA envisions a base rate and possibly a renewable “opt up” option where consumers could choose to pay extra for renewable energy, explained McMullen.

Community Choice Aggregation is not limited to Owego but includes the entire NYSEG service area of the Southern Tier and Central New York. The communities of Spencer, Burdett Village, Elmira, Hornell, the Town of Horseheads, Binghamton, Maine, The Town of Montour, Montour Falls Village and Canisteo are all exploring the program. Currently the program is limited to electricity supply and does not cover natural gas. 

More information about Community Choice Aggregation can be found on the MEGA websites, www.megaenergy.org and www.megacca.org.